Client Alert: Provider Coding Under Siege by PIP Payers, However, Lessons Learned are Valuable to ALL Healthcare Providers for ALL Payers

In the past few years the volume of PIP insurers focusing on coding utilization by Providers has increased substantially. From larger rehabilitation facilities to smaller practices, even solo physician practices, PIP insurers are paying great attention to billing and coding.

Reviews may be initiated through correspondence to the provider office. This correspondence may seem innocu­ous at first; however, it can lead to potentially serious legal issues if not addressed immediately and head-on. Of course anyone who receives any such notice should always immediately contact their health law attorney. In most cases, your attorney will initiate contact and the practice will start a review and analysis of the issues addressed with the goal of formulating a response that satisfies the PIP insurers with minimal financial and legal impact on the practice.

Is your practice prepared for such scrutiny? As the say­ing goes, the best defense is a good offense. When was your last external coding audit? Best practices dictate a regular review of coding with an eye towards utilization, justification, use of modifiers, and proper levels. An external E & M Coding Audit should be performed at least every two to three years and ALWAYS under engagement by your health law attorney. Not only does doing so ensure solid legal footing, some practices tend to undercode and are, therefore, losing substantial reimbursement for services provided.

Typically, a billing expert will analyze the procedure code utilization, review medical records, use a statistically valid sampling process, extrapolate error ratios, and analyze revenue loss. If issues exist, a separate remedi­ation plan may be implemented and tailored toward the needs of the practice to address areas such as provider education, EMR template structure and support, clinical protocol modification, and other focuses as dictated by the audit results. Frequent repeat analyses are performed during the remediation timeframe as well.

Results vary, of course, and run the spectrum of possible outcomes. Most of our experience, however, demonstrates a regular need for provider re-education, specifically on E & M coding. We also see some overutilization/misuse of modifiers, particularly in the chiropractic and rehabilitation specialties. Many practices come out ahead financially post-remediation of undercoding issues due to the increase in reimbursement.

Coding audits should be thought of as an insurance policy of sorts. Even with no errors detected, practices and provid­ers gain peace of mind while demonstrating steps toward compliance to any external entity.

In the PIP world and with other payers, do not wait until the payer calls you, writes you, or comes for a visit. In that case, the payer has already assessed your billings, calculated error ratios and determined amounts they wish to recoup from the practice. Stay in control of and ensure maximized revenues for your practice with regular reviews and analysis from independent, objective, external sources. Better performing practices are run on an old adage that serves well to this day: “Trust, but verify.”

Erin Smith Aebel is a Board Certified Health Law Specialist partner at Shumaker, Loop & Kendrick, LLP in Tampa, Florida. Erin represents diverse health care providers in business law, licensure, and compliance. Her law firm provides full service litigation and administrative service support.

Colin Shalin is CEO of The Practice Doctors, LLC “You treat your patients, we treat your practice,”, a Practice Management Consulting Company specializing in Coding Audits and A/R management with an emphasis on billing and collection process and performance improvement. Contact him by phone at 727.244.1179 or by emailing for a free A/R “Checkup”.